JPMorgan to double compliance budget in 2014

It’s been quite the year for mega-bank JPMorgan Chase. The financial firm finally reached a $13 billion settlement with the Department of Justice in November, settling the matter of tainted mortgage securities issued by the bank. Thanks to this run-in with the federal government, JPMorgan has decided to take preventative measures in the future.

These measures involve greatly increasing the company’s compliance budget. Jamie Dimon, CEO of the bank, stated that the company plans to spend $2 billion on compliance in 2014. That figure is double previous projections made by the bank. More importantly, Dimon said that the figure will remain at that level for the foreseeable future.

Included in the $2 billion budget is money for compliance staffing and training, as well as auditors who will evaluate the bank’s efforts. To offset the larger compliance budget, Dimon stated that the company will look to drop overall expenses, finding ways to make other departments more efficient.

The $13 billion November settlement was not the only black eye the bank faced this year. In October, it also settled a matter with the Commodity Futures Trading Commission. The $100 million settlement stemmed from the so-called “London Whale” deal. JPMorgan is not out of the weeds yet, as it is currently facing both civil and criminal probes in matters such as its hiring practices and its sales of mortgage-backed securities.

If this increased expenditure represents a genuine effort on the bank’s part to take compliance seriously, it is a step in the right direction. The largest financial institutions in the nation played a large role in the economic crises of the last several years, and keeping in compliance with government regulations will go a long way toward protecting the fragile economy from aftershocks.